BCC production tables show copper money reaching some sectors fast and others barely at all.

By Kanisa Magazine · November 2021

Copper output in the first ten months of 2021 ran 12.3 per cent ahead of 2020, yet the more telling numbers in the same BCC table sit lower down the page. Cement output rose 20.0 per cent. Potable water production fell 4.6 per cent. Timber logs halved. Congo’s mining boom and its everyday economy are linked, but not one for one.

The Banque Centrale du Congo’s own estimate puts 2021 growth at 5.3 per cent, from 1.7 per cent in 2020. Per head, the gain is smaller: 2.2 per cent, because the resident population is assumed to grow 3.0 per cent a year. The question for a business is which sectors turn mine income into household demand, and which do not.

Where mining income lands first

Cement, port tonnage and beer rose fastest in the table, and each is paid for by someone’s salary.

The BCC digest of 24 November lists cumulative output to October against the same months of 2020. Cement went from 1,080,139 to 1,296,376 tonnes. Goods handled in the ports of Kinshasa, Matadi and Boma rose 11.3 per cent to 1.58 million tonnes. Alcoholic drinks gained 7.1 per cent, wheat flour 6.4 per cent and telephone minutes 7.9 per cent. These are provisional figures, and the data come from companies and agencies rather than a household survey.

The route is easy to trace. Mining companies pay wages, royalties and taxes; the state spends part of that on roads, schools and payroll; contractors buy cement, and workers buy beer and airtime. Finance Minister Aimé Boji gave the fiscal side of the chain on 11 November, presenting a revised 2021 budget of CDF 16.6 trillion, about US$8.3 billion and 13.7 per cent above the original, according to Zoom Eco. The revision assumed 4.9 per cent growth.

Where it does not

Water and timber fell while the mines expanded, which is how a boom stays narrow.

Potable water output slipped from 249.5 to 238.0 million cubic metres over the ten months. Logs fell from 213,753 to 104,180 cubic metres, and sawn timber slid 9.8 per cent. Electricity output rose 5.9 per cent, roughly in step with the estimated growth rate, but output says nothing about who is connected.

A falling water line in a country adding 3 per cent more people a year means each household has less of a basic good, whatever copper is doing. The sectors that grew are those with a private operator, a clear buyer and, for cement and beer, a price that can follow demand. The ones that shrank depend on public networks, or on a forestry trade whose output swings widely from year to year.

The bottleneck is the tax base

Formal pay is large, but registered taxpayers are few, which caps how far mine income can spread.

On 30 November Nicolas Kazadi told a forum that the state holds only 200,000 tax accounts despite millions of formal employees, and that individual income-tax declarations would become mandatory from 2022, in place of the present system in which employers pay in bulk, as Zoom Eco reported. He framed it as widening the base among those who earn.

The other channel is local procurement. Tenke Fungurume Mining says it paid about US$384 million in taxes and fees in the first nine months of 2021, and that around 200 local entrepreneurs bid for 14 community projects in October, a company account carried by Zoom Eco. Contracts of that size turn a mine into a customer for local firms, which is where a mining payroll becomes a lasting market.

The close: read the sectors, not the growth rate

Back the businesses that sit on the first leg of the mine-to-household chain.

A supplier of building materials, packaged food or mobile services in Congo can use the cement and port series as a lead indicator and the BCC’s weekly digest to track it. A business that depends on public utilities, or on forestry, should plan for the opposite trend.

The practical step for 2022 is to tie sales forecasts to two inputs rather than one: mining payroll and procurement in the producing provinces, and the pace at which Kinshasa turns the larger budget into works that are actually paid for.